COLOMBO, Dec. 17 (Xinhua) -- Sri Lanka's Supreme Court ordered Wednesday to bring down the island's retail price of petrol in order to pass on the benefits of the falling oil prices in the world market to the consumers.

The order came after a public interest plaint filed and the court's earlier order on the Finance Ministry to come up with a reasonable price formula.

As a result, the retail price of petrol would be decreased from122 rupees (about 1.11 U.S. dollars) per liter to 100 rupees (about 0.91 U.S. dollar) from midnight Wednesday. The court said the benefits of falling prices for fuel in the global market need to be passed on to the consumer.

The main opposition United National Party had accused the government of making a huge profit in petrol despite the global oil prices falling to 45 dollars a barrel from 130 dollars. The opposition said the government was unable to reduce prices due to hedging contracts entered with foreign banks.

The Supreme Court last month ruled the hedging deal as illegal and suspended the payments to at least three foreign banks. Annually, Sri Lanka consumes about four million tonnes of fuel products, all of them being imported.

Guest

Post subject: Sri Lanka petrol prices not changed for second day

Posted: Tue Dec 30, 2008 12:13 pm

Sri Lanka petrol prices not changed for second day

@ LBO18 Dec, 2008 / By Ishara M Gamage

Dec 19, 2008 (LBO) – Sri Lanka's cabinet of ministers had not revised oil prices after meeting for a second time, with a court decision to cut prices still to be officially conveyed, an official said.

The director of government information, Anusha Pelpita said an official decision on oil has not been received as of 8.00 pm Thursday.

The cabinet is expected to meet again on the issue, he said. Sri Lanka's Supreme Court directed the government to reduce petrol prices to 100 rupees a litre from 122, by midnight, Wednesday.

But the government said Wednesday it was yet to receive the written court direction.

The stand-off has caused petrol pumps to run dry with long queues of cars being seen around the capital Colombo.

The government has said that cutting petrol prices would result in revenue losses.

The standoff between the court and the government has created an artificial fuel shortage and long lines at the pump.

Many filling stations, unsure what price to charge, did not fill tanks Thursday, fearing they would end up buying gas at the higher price and be forced to sell it at the court-ordered discount. Stations across Colombo ran out of fuel, and lines stretched into the streets for those that had some left.

The government, expecting oil prices to continue climbing, agreed earlier this year to buy all of its fuel at the price of $134 a barrel until next summer. In recent months, however, the price of oil has plummeted to under $50 a barrel.

A recent document submitted in court estimated the deal could cost as much as $775 million, economist Harsha de Silva said.

With oil prices plunging, the Supreme Court ordered the government Wednesday to immediately reduce the state-set price of gas from 122 rupees to 100 rupees (about $1).

But instead, the court's efforts have created a black market that sent the price in some places skyrocketing to 145 rupees a liter.

The government ignored the order, with Trade and Consumer Affairs Minister Bandula Gunawardena saying the Cabinet can't act because it never received an official copy of the court order. The court has said it delivered the ruling to the appropriate government officials.

Chandana Alutge, a university teacher, said he stopped driving his car because of the shortage.

"This is not good for the country," he said.

The opposition United National Party claimed the government won't reduce the gas prices so it can use the extra profits to cover the losses from the oil hedge.

The court has made no comment on the dispute.

Guest

Post subject: LIOC obeys Supreme Court order in Sri Lanka

Posted: Tue Dec 30, 2008 12:21 pm

LIOC obeys Supreme Court order in Sri Lanka

Saturday, 20 December@ Agencies / LL

Lanka Indian Oil Company (LIOC) says that the company obeys the Supreme Court order to reduce the price of a litre of petrol to Rs. 100. Managing Director of the LIOC, KR Suresh Kumar, told BBC Sandeshaya that the company already received the Supreme Court order issued on Wednesday.

In line with the direction of the honourable Supreme Court the same is being implemented from tonight. The Supreme Court order was given only today so we consulted the lawyers and we have obeyed the order of the Supreme Court and it is being done now, he said.

Sri Lanka Supreme Court on Wednesday ordered the government to reduce the price of petrol to Rs. 100 per litre while the price of the barrel of oil remains 42 US dollars in the world markets.

The court made the order after the Ceylon Petroleum Corporation (CPC) presented a new price formula. The court dismissed an earlier formula by the CPC which proposed to impose 180 percent tax on fuel.

Noting that the benefit of the price reduction should pass on to the consumers, the CPC was ordered not to exceed 75 percent of tax. The order was made after considering a petition against controversial hedging deals signed by the former CPC chairman, Asntha de Mel.

The government, however, is yet to implement the order on the grounds that it is yet to receive the written directive from the court. Cabinet spokesman, Media Minister Anura Priyadharshana Yapa told the journalists on Friday that the government is yet to receive a copy of the order. He did not say whether the government is to reduce the price of oil according to the court order.

The Registrar of the Supreme Court told BBC Sandeshaya that copies of the directive were sent to the Presidential Secretariat, Finance Ministry and the CPC on Thursday night.

Guest

Post subject: War against the Sri Lankan judiciary

Posted: Tue Dec 30, 2008 12:24 pm

War against the Sri Lankan judiciary

A few days earlier President Mahinda Rajapakse had stated, “I am less than a magistrate” while complaining about judicial interventions against his decisions. Among his complaints were that two of his officers had been removed from their posts due to Supreme Court rulings and, more importantly, the issue of the 17th Amendment to the Constitution.

By Basil FernandoDecember 19, 2008

Hong Kong, China — The Supreme Court of Sri Lanka, in a controversial judgment on Dec. 17, ordered a reduction in petrol prices and said it should be implemented on the same day. The government, on the other hand, declared that it would not implement the court’s ruling as it was contrary to the war effort against the Liberation Tigers of Tamil Eelam. Furthermore, as per reports of a Cabinet meeting, the president also called on the government to oppose the court.

The court ruled that petrol with an octane count of 90 should be reduced to 100 rupees (US$0.89) per liter from the prevailing price of 122 rupees (US$1.08), and the other petrol grade with an octane count of 95, currently selling at 137 rupees US$1.21), should be similarly reduced.

A few days earlier President Mahinda Rajapakse had stated, “I am less than a magistrate” while complaining about judicial interventions against his decisions. Among his complaints were that two of his officers had been removed from their posts due to Supreme Court rulings and, more importantly, the issue of the 17th Amendment to the Constitution.

The implementation of this amendment had been suspended on various pretexts by the government. The Supreme Court intervened and called for the immediate implementation of this constitutional provision.

According to the 17th Amendment, a Constitutional Council appointed with the agreement of all political parties is to be given the power to appoint commissioners to several public authorities. These commissioners will have the power of appointment, promotion, disciplinary control and the dismissal of officers.

The purpose of this law is to prevent direct political appointments to important posts in the public service and to ensure that persons are selected purely on the basis of merit. The implementation of this law undermines the executive to the extent of preventing arbitrary appointments for political reasons.

The government’s claim that the Supreme Court’s decision on petrol prices will affect its war effort may sound comical to an outside observer. However, the political ideology and propaganda in Sri Lanka today is centered on one central enemy at a time, as has always been the case with totalitarian regimes.

For Hitler, it was communists first and later the Jews; for Joseph Stalin it was the counterrevolutionary bourgeoisie and then the Trotskyites. George Orwell in his famous novel, “1984,” exposes this aspect of authoritarianism through the character of Goldstein who is the enemy and the excuse for all the actions of the party in power.

Petrol, however, is a commodity that is needed for everything and therefore affects everyone. Oil prices affect the prices of all commodities. So the Supreme Court’s decision should help to bring down the prices of many commodities, particularly basic necessities.

In fact, the Burmese uprising in August 2007, known as the Saffron Revolution, was spurred by an increase in oil prices, which led to the increase in prices of basic food items. Therefore, it is no surprise that most people in Sri Lanka support the lowering of oil prices and also hope that this will bring down the prices of other commodities.

The government’s non-compliance with judicial orders should also worry the people. There are many reasons for this concern. First is the 200-year-old tradition of the separation of powers, which has created resentment in local minds against the absolute power of the executive.

Over the past 40 years there have been many attempts to undermine the judiciary and there have been setbacks in the institution. However, the basic belief in the separation of powers and respect for the judiciary still remains strong among the people. On the other hand, contempt for politicians is universal among Sri Lankans. Therefore, in any conflict there would be greater support for the judiciary than the executive.

In recent years, there has been a further reason for the people to look to the judiciary as a kind of savior – they have recourse to no other institution. All public institutions such as the police, the prosecuting system and the public services are so politicized that the people cannot expect assistance from them. The judiciary is the only hope.

The strong support the judiciary still enjoys with the people has so far prevented attempts by the government to unite in opposition to a court order. Press reports show that in the Cabinet itself there is a serious division of opinion.

However, this conflict with the executive, which is attempting to undo the principle of separation of powers, is inevitable. In fact, this tension has been present since the adoption of the 1978 Constitution. Despite many attempts by several presidents, it has not been possible to make the judiciary completely subservient to the executive.

In the initial stages Chief Justice Neville Samarakoon, previously a close associate of the executive president, J.R. Jayewardene, became his bitter enemy when the president tried to suppress the independence of the judiciary. Even the appointment of the present chief justice by former President Chandrika Kumaratunge was widely perceived as her attempt to have the judiciary on her side.

However, despite all such attempts, the tension between the executive and the judiciary has continued. Rather, it has surfaced as an open conflict.

The resolution of this conflict will necessarily be political. The people will have to resolve the issue of either living under a political system that is completely under the control of the executive or maintaining the separation of powers. According to reports, the government has already ordered the use of all propaganda at its command to support itself in this new war against the judiciary.

On the other hand, it is very likely that support for the judiciary will arise from all quarters. Particularly the country’s middle class, including the business community, would not wish to have the country controlled by the executive. On the other hand, for ordinary folk and the poor, further strengthening of the executive will only mean further hardships including higher prices of commodities.

Under these circumstances, a political crisis that will affect the basic human rights of the people has surfaced. If the executive wins this war against the judiciary, people will soon be heading in the direction of the type of life that prevails in places like Burma and Cambodia.

Whether the Sri Lankan people will become completely voiceless and submissive in the face of increasing poverty and degradation of life will depend on whom they support in this conflict between the executive and the judiciary.

--

(Basil Fernando is director of the Asian Human Rights Commission based in Hong Kong. He is a Sri Lankan lawyer who has also been a senior U.N. human rights officer in Cambodia. He has published several books and written extensively on human rights issues in Asia. His blog can be read at http://srilanka-lawlessness.com.)

The Cabinet of ministers once again postponed taking a decision on last week’s Supreme Court directive, on the Ceylon Petroleum Corporation, to reduce the price of a litre of petrol from Rs.122 to Rs.100, when it met yesterday evening at Temple Trees.

Informed sources, said that the Cabinet meeting presided over by President Mahinda Rajapaksa began with Petroleum Resources Development Minister A. H. M. Fowzie distributing copies of the Court order.

"The President then asked the Ministers for their views, but they wanted time to peruse the order carefully. Accordingly it was decided that the Ministers present their observations when they meet again on January 7, 2009.

Yesterday was the third time the Cabinet took up the Supreme Court directive on petrol pricing and postponed taking a decision for a later date. It first met on December 17, the day the order was delivered, but adjourned the meeting for the following day on the grounds that an official copy of the directive had not been received. The same reason was given when it convened on the second occasion as well.

While the CPC continues to sell petrol at Rs. 122 a litre, Lanka Indian Oil Corporation (LIOC) sold petrol with effect from midnight on December 19, at Rs.100.

This situation has led to long vehicle queues forming outside LIOC stations and more often than not motorists have had to turn back due to supplies running out quickly.

The general public too have been greatly inconvenienced due to widely varying fares being quoted by taxi drivers, based on what they claim is the price at which petrol was purchased.

Guest

Post subject: Long queues for petrol in Sri Lanka at LIOC stations

Posted: Tue Dec 30, 2008 12:43 pm

Long queues for petrol in Sri Lanka at LIOC stations

Saturday, December 20, 2008@ ColomboPage News Desk, Sri Lanka

Dec 20, Colombo: The decision made by the Lanka Indian Oil Company (LIOC) to reduce the petrol prices to Rs. 100 per liter following the Supreme Court order has resulted in long queues outside their filling stations.

Obeying the court order the IOC had reduced its price of a petrol liter with effect from yesterday midnight.

According to the reports from Colombo and its suburbs as well as from the rural areas long queues have been seen outside every filling station of IOC to purchase petrol at reduced prices.

This situation will incur additional loss to the government owned Ceypetco filling stations as they will be unable to sell the stocked petrol at higher rates. The prices at the Ceypetco stations remain at Rs. 122 per liter since the government has not followed the Supreme Court order.

Financial analysts say the government is now forced to cut the prices as the Supreme Court ordered or else lose the revenues to LIOC.

Guest

Post subject: Sri Lanka IOC raises petrol price again

Posted: Tue Dec 30, 2008 12:47 pm

Sri Lanka IOC raises petrol price again

@ LBO / 24 Dec, 2008

Dec 24, 2008 (LBO) - The Sri Lanka unit of the Indian Oil Corporation, which slashed petrol prices in response to a Supreme Court order, raised the retail prices back to the earlier level of 122 rupees Wednesday.

The administration of president Mahinda Rajapaksa has not cut taxes as directed in the court order so far, and state-run Ceylon Petroleum Corporation, has also kept its retail price unchanged.

Sri Lanka's cabinet of ministers had met several times over the issue, but has so far not changed taxes as directed in the court order, in a stand-off between the executive and the judiciary, that analysts say could move towards a constitutional crisis.

Meanwhile Lanka IOC chief Suresh Kumar said his company had cut the price under a court order, but when a new consignment of petrol was brought to the country on Wednesday, the same taxes were charged, forcing him to raise prices. He said it was "not correct" to say that the government had put pressure to raise prices.

Court ordered petrol prices slashed following a public interest petition filed by an opposition lawmaker, a Buddhist monk and an anti-corruption activist. The petitioners said the government was charging an exorbitant 72 rupees of taxes on petrol which cost around 30 rupee to import and was also keeping a hefty margin of profit.

Government ministers have defended the taxes saying it is needed for development activities and subsidies, but economic analysts have pointed out that more than 50 percent of the taxes are spent on the salaries and pensions of a bloated public service. The entire capital budget of the government is also financed out of debt, and the government has not been able to even balance its current budget for decades.

The country has weak infrastructure due to years of chronic under-investment, especially in rural areas but the country has more than a 100 ministers out of a total of 225 lawmakers.

Guest

Post subject: UNP says govt. pressurised LIOC

Posted: Tue Dec 30, 2008 12:51 pm

UNP says govt. pressurised LIOC

By Kelum Bandara @ DM / Friday, December 26, 2008

The main opposition UNP yesterday charged that the government had applied pressure on the Lanka Indian Oil Company (LIOC) at different levels to increase petrol prices and not to comply with the Supreme Court ruling, in what was seen as a situation that might trigger a crisis regarding foreign direct investments to the country.

UNP frontliner Lakshman Kiriella told a news conference that the Supreme Court ordered the reduction of fuel price as part of its judgment which suspended the controversial hedging deal.

Mr. Kiriella said that the government accepted the ruling on the suspension of the hedging deal which saved it Rs. 48 billion. “However, it has not complied with the ruling to reduce petrol prices. The government has to accept the judgment in full, not in part. Because of the price reduction as ordered by the court, the government will lose only Rs.14 billion. Yet, it was able to save Rs.48 billion by suspending the hedging deal,” he said.

The UNP MP claimed that the government had now forced the LIOC to ignore a Supreme Court ruling, and therefore foreign banks that struck the hedging deal would also lobby before the international arbitration tribunals for the nullification of the ruling on this transaction as well.

“The hedging deal was worked out by the Cabinet. If these banks get a ruling favourable to them by an international court, the government will be compelled to pay Rs. 48 billion due to them. There are legal luminaries in the ruling coalition. But, they do not understand this reality,” he said.

He said the non-compliance of judicial orders would convey the message that Sri Lanka is a lawless country. “Foreign investors will lose their business interest in the country as a result. They will start leaving the country putting the economy in jeopardy,” he said

Guest

Post subject: Fowzie wants fuel prices reduced

Posted: Tue Dec 30, 2008 12:57 pm

Fowzie wants fuel prices reduced

@ Sunday Leader / 28 Dec 2008

Petroleum Minister A.H.M. Fowzie has urged President Mahinda Rajapakse to honour the Supreme Court order on the reduction of fuel prices and implement the pricing formula immediately. The Minister told the President the Chairman of the Ceylon Petroleum Corporation wanted to resign for fear of being hauled up before the Supreme Court on contempt charges for the corporation’s failure to implement the December 15 Court Order to sell a litre of petrol at Rs. 122.

Minister Fowzie fought a lone battle in Cabinet on Tuesday, December 23 to get the Cabinet to approve the price reduction in terms of the Supreme Court order without further delay but his plea was rejected by President Mahinda Rajapakse.

The President who circulated a copy of the Supreme Court Order at the Cabinet meeting said the Ministers needed time to study it in detail and revert to Cabinet at the next meeting scheduled for either December 31 or January 7.

The President also told Minister Fowzie the CPC Chairman was free to resign if he feared action by the Supreme Court.

Minister Fowzie, it is learned told the President he will communicate the Cabinet’s view to the Chairman and ask him to take a decision he sees fit in the circumstances.

Informed sources said Minister Fowzie also told the President there was no need to grant Ministers further time to study the Court Order since it was straight forward and that the Court had come to a finding that there was arbitrary Executive action. "What is there to study it further. Let us comply and complain," Fowzie had argued.

However Consumer Affairs Minister Bandula Gunawardene had told Cabinet in terms of the Constitution only Parliament can impose or reduce taxes and that such authority is not vested in the Supreme Court. The Sunday Leader learns Minister Fowzie had told Minister Gunawardene not to attempt to teach the Supreme Court the law of the land.

Fowzie had said the Chief Justice knows what his powers are and the interpretation of the Constitution was within the jurisdiction of the Supreme Court and that they have clearly determined there was an arbitrary use of executive power in imposing levies on fuel.

Guest

Post subject: President tried to telephone CJ

Posted: Tue Dec 30, 2008 1:06 pm

President tried to talk on telephone but Chief Justice refused to answer

The President has been uttering the phrase “Mang Moota Honda Paadamak Ugannang Ko” meaning “I will teach him a good lesson”.

@ transcurrents.com / 28 Dec 2008

A major contributory factor to the prevailing conflict between the Sri Lankan executive and judiciary is the egoistic clash on a personal level between President Mahinda Rajapakse and Chief Justice Sarath Silva.

The President has been uttering the phrase “Mang Moota Honda Paadamak Ugannang Ko” meaning “I will teach him a good lesson”. Though the President has refrained from naming anyone explicitly , it is generally understood that the reference is to the CJ.

The President during the cabinet meeting displayed a very hostile attitude and shot down all attempts by some ministers to resolve it amicably.A Cabinet minister speaking on condition of anonymity revealed the reason for the Presidents belligerence.

According to the minister the President had at the outset wanted to placate the Chief Justice and prevent a crisis erupting. Being tipped off by intelligence officials that the Chief Justice was contemplating the issuance of a controversial ruling on the matter , President Rajapakse wanted Chief Justice Silva not to proceed in that direction.

Initially the President tried to contact the Chief Justice but Sarath Silva sensing what was coming made himself unavailable. Then the President had sent a mutual friend to meet the CJ and make the request.

When the “friend” a senior lawyer met the Chief Justice and conveyed the President’s message the chief justice had been visibly angry and had ticked off the mutual friend that as a senior lawyer he should not be seen as trying to interfere with the judiciary or obstruct the course of justice. When the lawyer reported this, the President was annoyed but tried to call the Chief justice on the telephone and explain matters.

Despite several attempts to talk the President had been unsuccessful as the Chief Justice refused to talk to him. Thereafter the Supreme court went ahead and delivered its controversial ruling.

Even after the ruling the President had repeatedly attempted to talk on the telephone to the Chief Justice but Mr. Sarath Silva had not answered. Speaking further the minister said that this adamant refusal by the Chief Justice to talk to him had angered the President.

“Our President is not one who is angered easily but when he is aroused there is no stopping him” the minister said. This is the reason why the President has taken this matter personally and seriously , he said